SK Hynix reports on 28 October and Samsung on 29 October: the earnings week that decides if the AI chip trade survives

When do SK Hynix and Samsung report earnings? SK Hynix announces third quarter results on Wednesday 28 October, with its conference call at 9 a.m. Korea time, and Samsung Electronics releases its final third quarter results on Thursday 29 October at 10 a.m., according to Digital Today. Analysts expect the two memory giants to report combined operating profit above 180 trillion won.

These are not ordinary results. The KOSPI crashed 7.57 percent in a single day on 15 October as worries about the cost and financing of AI infrastructure spread from Wall Street to Seoul. Samsung and SK Hynix are the two biggest beneficiaries of AI memory demand, and together they dominate the Korean index. If their numbers and guidance hold up, the AI chip trade can recover. If they disappoint, the sell off could deepen.

What are analysts expecting?

Expectations are enormous, but not uniform. DS Investment and Securities projected SK Hynix operating profit of 70 trillion won for the third quarter, up 16 percent from the previous quarter but below a consensus of about 78 trillion won, citing the won exchange rate and the timing of revenue recognition during the transition to next generation high bandwidth memory. Other brokers have forecast figures closer to or above consensus.

The comparison base is already extraordinary. In the second quarter, SK Hynix reported revenue of 79.3 trillion won, up 257 percent from a year earlier, and operating profit of 60.5 trillion won, a 76 percent margin, according to Yahoo Finance. Samsung has already given a preview. Its preliminary estimate on 8 October put third quarter operating profit at a record 107.4 trillion won, about 80 billion dollars, up 782.5 percent from a year earlier, on revenue of 195 trillion won, according to TIKR via Yahoo Finance. It was the first time a Korean company cleared 100 trillion won in a quarter, and Thursday's final release will add the division breakdown.

Two factors could weigh on the final figures. A stronger won reduces the value of overseas sales when converted back, and both companies have faced pressure from workers seeking bigger bonuses from the AI windfall, which can lift provisions.

Why this week matters more than usual

The market's question has changed. Earlier this year, investors asked how fast AI demand would grow. Now they ask whether the companies buying AI infrastructure can keep paying for it. Meta's credit default swap premium hit a record high after it announced bigger AI infrastructure spending, and highly leveraged AI firms such as CoreWeave and Oracle have come under scrutiny.

That shift hit Korea hard. The KOSPI fell as low as 5,305.98 during trading on 23 October before closing up 0.30 percent at 5,550.30, as bargain hunters bought Samsung and SK Hynix. Foreign investors were still net sellers of 98.3 billion won that day. We analysed the first leg of the rout in our report on the AI chip stock sell off that hit SK Hynix and Samsung.

The question for memory makers is no longer whether AI needs chips. It is whether the buyers of those chips can keep borrowing to pay for them.

The industry view is that AI demand has not collapsed, but that companies financing expansion with debt face a higher bar in a high interest rate world. Results that show firm HBM orders and steady pricing would ease those fears.

What investors will look for

Headline profit will matter, but guidance will matter more. Investors want to know whether HBM and server memory demand remains strong into 2027, whether memory prices are holding, and how much both companies plan to spend on new capacity. SK Hynix said this month it still wants to build a new US chip plant while considering other ways to fund it, after scrapping a planned US listing for its Solidigm unit.

Market share is another question. J.P. Morgan has estimated that SK Hynix's share of the HBM market falls to 46 percent this year from 60 percent as Samsung catches up, so investors will look for evidence on how the two are splitting AI orders.

Shareholder returns are the other focus. With foreign investors selling Korean stocks, buybacks or higher dividends from the two largest companies could support the market. The key points to watch include:

• HBM demand and pricing for 2027, including next generation products
• Server and data centre memory orders from major AI customers
• Capital spending plans and how they will be funded
• Share buybacks and dividend increases
• The impact of the won's strength on reported earnings

What it means for Korea and the won

Samsung and SK Hynix together account for close to half of the KOSPI's weight, so their results move the whole market. Strong numbers could draw foreign money back into Korea and support the won, which has already rebounded sharply this year on chip export revenue, as we covered in our report on the won's swing to a two year high.

Weak guidance would do the opposite. It would confirm fears that the AI investment cycle is peaking, hit Korean exporters and pressure the currency. Because Korea is a bellwether for global technology demand, the results will also influence chip stocks in Taiwan, Japan and the United States.

For Southeast Asia, the read across is indirect but real. Malaysia, Singapore and Vietnam supply packaging, testing and electronics components for the chip industry, and their exports track the same AI cycle.

The bottom line for earnings week

This week combines the US Federal Reserve decision on 28 October with results from the two most important memory makers in the world. That makes it one of the most consequential weeks of the year for Asian technology stocks.

The most likely outcome is very strong reported profits alongside careful guidance. Whether the market celebrates or sells will depend on whether management convinces investors that AI demand, and the money to pay for it, will last into 2027.

Samsung and SK Hynix enter earnings week with record profits within reach and investor nerves at their highest in months. The numbers will almost certainly be huge, but the market will judge them on guidance for HBM demand, capital spending and shareholder returns. Those answers will decide whether October's AI chip rout was a correction or the start of something bigger.